Redbox closes after parent company files for Chapter 7 bankruptcy

The judge overseeing the bankruptcy case of Redbox’s owner, Chicken Soup for the Soul Entertainment, reportedly granted a request to change the bankruptcy from Chapter 11 to Chapter 7 on Wednesday. Low Pass‘ Yanko Roggers and The Wall Street JournalA lawyer for the company said Chicken Soup for the Soul Entertainment will lay off its remaining 1,000 employees and liquidate its operations, including its streaming business and about 24,000 disc kiosks that have long rented DVDs, Blu-rays and video games.

According to Roettgers, Judge Thomas Horan said the company “has no means of continuing to pay its employees, pay its bills, or fund this litigation. It is completely insolvent….Given the fact that there is at least a possibility that funds held in trust for its employees may be misappropriated, there is every reason to convert this case.”

In addition to operating Redbox, Chicken Soup for the Soul Entertainment also manages brands such as Crackle and Screen Media. Chicken Soup for the Soul LLCthe company as a whole was not involved in the bankruptcy case. The Wall Street Journal.

Chicken Soup for the Soul Entertainment did not immediately respond to a request for comment.